FICO simulato: need help with ‘paying on time’

[Aspireto850]

Happy Saturday,

Quick question. In the FICO simulator specifically for the ‘pay all bills in time scenario’ does that apply to all account on your whether they open, closed, CO, collection etc? Or does it just apply to open accounts and COs are excluded?

Thanks

[FireMedic1]

Simulators are not reliable. The MyFICO one is what you score is now and what it might be 2yrs away. You can slide it back. Only goes by score. But it has not been exact in my case in 3 yrs. No matter what you choose. Too much to calculate. Close but no cigar.

[NRB525]

OP the phrasing of your question implies you are trying to understand how charge offs or collections affect your score?

Do you have existing charge offs? Are there cards you anticipate not being able to pay?

[Aspireto850]

@NRB525,

What I’m trying to better understand is how the “pay all bills on time” simulator scenario is defined. When it says ‘all bills’ is that related to open account or ALL accounts including CO, closed accounts with balances and collections. As an example, if an account is in CO status there is not a ‘monthly’ amount due per se’. So exactly what is the simulator taking into consideration for ‘all bills’? In addition to my open accounts I do have a CO and an account closed by credit grantor in which I’m continuing to make payments (as I should). So when I use the simulator and it shows the potential score impact of paying bills on time I’m just trying to find out which account type are factored into the scoring model for that particular scenario.

[NRB525]

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@Aspireto850 wrote:
@NRB525,

What I’m trying to better understand is how the “pay all bills on time” simulator scenario is defined. When it says ‘all bills’ is that related to open account or ALL accounts including CO, closed accounts with balances and collections. As an example, if an account is in CO status there is not a ‘monthly’ amount due per se’. So exactly what is the simulator taking into consideration for ‘all bills’? In addition to my open accounts I do have a CO and an account closed by credit grantor in which I’m continuing to make payments (as I should). So when I use the simulator and it shows the potential score impact of paying bills on time I’m just trying to find out which account type are factored into the scoring model for that particular scenario.

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To improve your FICO score, the only absolute rule is, pay all your obligations at least the minimum payment, on time. Every other decision is a choice about how to use credit. This includes closed accounts with remaining balances, which I have had several over the years and have one remaining.

As soon as you step away from that cardinal rule, all bets are off about how your score will look. Whether that means ceasing to pay and getting a 30-day late, or having an old set of lates that is developinging into a charge off that one thinks will not be paid, all those "did not pay on time" situations result in reduced FICO score, and a ceiling on how much a score can be improved while those "did not pay" exist on the credit report.

Once the cardholder enters "did not pay on time" territory, there are no simulators that will be able to accurately forecast what happens next. The best we can say is, over the long run, if you get back to paying on time, and all those "did not pay on time" situations drop off your report, then you can start looking at simulators.

That's a long way around to answering your "quick question" that I think whatever approach is taken with a score simulator, while there are "did not pay on time" situations, the simulator can not yield good information. Simulators are not a clear view into specifics of FICO scoring, they are general tools that are likely only directionally accurate.

[DollyLama]

This is the way I look at the "pay all your bills on time" for X months.

If I do not open or close any new cards or loans for X months. 

If I do not cross any utilization thresholds on revolving or installment loans of what is on my report now.  So if my utilization is as of today is14%, I will not let it cross over the next threshold.  Or vice versa, if its at 63% and I do not pay it down. 

I will not have any late payments on any open accounts.

No old collections or charge offs will suddenly "appear" on my reports. 

I will not apply for anything that will cause an inquiry. 

Basically it's an aging of X months if absolutely nothing changes. That is why it is unreliable and taken with a grain of salt. Those 40 points you may get in 24 months (aging your report), and be gained by lowering utilization and using AZEO.  A paid off loan if it is your only one within this time period will knock you down a good 30 points. Applying for any credit in that time period reduces your age of accounts,  plus the ding for inquiries.  There just so many unpredictables in the X months (24 mos max on simulator) that you truly can not rely on it.

[Aspireto850]

Thanks a bunch!